Charity

Until the new Civil Code came into effect, the only means to put charitable donations into institutionalised form had been the foundation. Despite its many advantages, this institution has an important disadvantage arising from its legal entity status: costly and cumbersome administration. Trust provides an alternative for charitable donations especially in cases where the property to be offered for a charitable aim is small or aimed at supporting a single purpose which is limited in time. Concurrently with transferring the asset intended for donation, the settlor can specify the charitable aim in the trust deed, which the trustee must support using the asset or its yields. Naturally, it is also possible that a private as well as a charitable aim is specified in the trust deed. In this case, the managed asset remaining after the death or the dissolution of the beneficiaries, or even when the beneficiaries are still alive, the asset or a part of it designated in advance is used by the settlor for a charitable aim. When the asset is used up or the designated aim ceases to exist, the trust can be terminated in a relatively simple manner in terms of administration. A charitable aim can be supported in an extremely rapid and cost-effective manner by using a trustee, which represents a significant advantage compared to the rigid form of a foundation.